Nadeem Jafri's super market, a hope for people in gloom

This week CNBC-TV18‘s special show, Young Turks highlights the achievements of a 41-years-old, who would not strike as a quintessential entrepreneur.

This week CNBC-TV18's special show, Young Turks highlights the achievements of a 41-years-old, who would not strike as a quintessential entrepreneur. After studying retail management, Nadeem Jafri, Founder, Hearty Mart spent years in the advertising world in Mumbai until 2002 Gujarat riots that led him to decide to give his corporate career a pass and turn entrepreneur.

He set up Hearty Mart with the idea of giving people of Gujarat the experience of a super market and today Jafri has created hope where earlier there was only despair.

February 2004 may not have been the best time to take the entrepreneurial plunge in the Juhapura neighbourhood of Ahmedabad. The nightmare of the worst communal riots that Gujarat saw eclipsed normal life.

Juhapura became home to 5 lakh refugees making it the largest Muslim neighbourhood in Gujarat. Thousands of kilometers away in Mumbai, Nadeem Jafri grew weary of his job at an advertising firm and decided to take the entrepreneurial route. Enamored by a Big Bazaar experience in Mumbai, Jafri decided to start-up Hearty Mart, a super market at Vishala Circle on the edge of the neighbourhood.

Jafri saw opportunity where others saw only despair. He bet on his relatively prosperous Chilia Muslim community to support the venture and raised capital from friends and relatives.

Yet after eight months, he was back to looking at classifieds.

Jafri said that was in 2004, for around eight months I was in sabbatical. I was working with an advertising agency called Grey Worldwide for almost six years. I left the job and started my Hearty Mart in Juhapura, Ahmedabad. For eight months, I worked nowhere. Once I felt that my team is well-equipped to run the shop, I quitted and rejoined Times of India as a marketing manager and later on I was called back by Grey Worldwide to work with them again. Any business takes its own time to turn into a profit-making unit and Hearty Mart was no exception.

But like any fledgling start-up, progress was slow. Having used every tactic in the book including customer loyalty programmes and home delivery services to make profits, Hearty Mart still required sales worth Rs 3.75 lakh a month to breakeven and even that was proving to be a stretch.

That led to the birth of Hearty Mart Enterprises a wholesale food and grocery supplier to hotels. Jafri’s argument was that since this community was running hotels, it would be easier for him to find takers. The gamble paid off and sent the cash registers ringing.

Not just food and groceries, Jafri has also taken Hearty Mart down the route of logistics and tea production. Hearty Mart Logistics works as a stockist for popular bakeries around Gujarat and Day Break is the Hearty Mart tea brand being sold both off shelves and to hotels and restaurants. In the pipeline is also Jafri’s own food label Good Time.

Jafri said that he also launching his own brand.

Jafri highlights the challenges of setting up his first venture.

Jafri said, since we started Hearty Mart in Juhapura, it was the area which was supposed to be a negative area, non-business friendly and took us a lot of time to convince suppliers to even come to us. There were get-togethers, which we organised, even the Vishala Circle where the Hearty Mart is located, a newly developed area and the residents had come from other areas. So, they were never patronizing the locality and hence they never patronized our store.

And patience does pay. Jafri’s initial capital of Rs 62 lakh has now seen a return of Rs 15 crore. Jafri tells us the differentiator came when he decided to take the franchise route and in 2007, he set up Hearty Mart’s first franchise store in Ilol, a large village surrounded by plenty of smaller villages.

In doing so, Jafri empowered several entrepreneurs from his community. Hearty Mart’s 11 franchise shops are in Dholka, one of the oldest municipal towns of Gujarat.

Charging a one-time fee of Rs 15,000 from a franchise, Jafri takes 0.5 percent of royalty on profits from the second year onwards.

Jafri said that they had one case study in Juhapura. With this learning we went there, we trained them. In fact, in certain cases all franchise owners were called at my shop, they were trained on modern techniques of organised retailing like operating computers and analyzing data and even negotiating with vendors and that helped us a lot.

Sticking to his belief that the franchise route is the way to go for Hearty Mart, Jafri now wants to bring Hearty Mart to neighbourhoods in Maharashtra and Rajasthan. He knows challenges will now be capturing other demographics and blurring the lines of cast and religion when it comes to his customer base. But for this avid blogger, a Pan India presence is the ultimate dream.